Correlation Between Tel Aviv and Meitav Trade
Can any of the company-specific risk be diversified away by investing in both Tel Aviv and Meitav Trade at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Tel Aviv and Meitav Trade into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Tel Aviv 35 and Meitav Trade Inv, you can compare the effects of market volatilities on Tel Aviv and Meitav Trade and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Tel Aviv with a short position of Meitav Trade. Check out your portfolio center. Please also check ongoing floating volatility patterns of Tel Aviv and Meitav Trade.
Diversification Opportunities for Tel Aviv and Meitav Trade
0.93 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Tel and Meitav is 0.93. Overlapping area represents the amount of risk that can be diversified away by holding Tel Aviv 35 and Meitav Trade Inv in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Meitav Trade Inv and Tel Aviv is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Tel Aviv 35 are associated (or correlated) with Meitav Trade. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Meitav Trade Inv has no effect on the direction of Tel Aviv i.e., Tel Aviv and Meitav Trade go up and down completely randomly.
Pair Corralation between Tel Aviv and Meitav Trade
Assuming the 90 days trading horizon Tel Aviv is expected to generate 2.68 times less return on investment than Meitav Trade. But when comparing it to its historical volatility, Tel Aviv 35 is 1.51 times less risky than Meitav Trade. It trades about 0.16 of its potential returns per unit of risk. Meitav Trade Inv is currently generating about 0.28 of returns per unit of risk over similar time horizon. If you would invest 609.00 in Meitav Trade Inv on August 29, 2024 and sell it today you would earn a total of 542.00 from holding Meitav Trade Inv or generate 89.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Tel Aviv 35 vs. Meitav Trade Inv
Performance |
| Timeline |
Tel Aviv and Meitav Trade Volatility Contrast
Predicted Return Density |
| Returns |
Tel Aviv 35
Pair trading matchups for Tel Aviv
Meitav Trade Inv
Pair trading matchups for Meitav Trade
Pair Trading with Tel Aviv and Meitav Trade
The main advantage of trading using opposite Tel Aviv and Meitav Trade positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Tel Aviv position performs unexpectedly, Meitav Trade can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Meitav Trade will offset losses from the drop in Meitav Trade's long position.| Tel Aviv vs. One Software Technologies | Tel Aviv vs. Rapac Communication Infrastructure | Tel Aviv vs. Teuza A Fairchild | Tel Aviv vs. Magic Software Enterprises |
| Meitav Trade vs. Nice | Meitav Trade vs. The Gold Bond | Meitav Trade vs. Bank Leumi Le Israel | Meitav Trade vs. ICL Israel Chemicals |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the AI Portfolio Architect module to use AI to generate optimal portfolios and find profitable investment opportunities.
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